The South African economy is lagging behind these international developments and hence the continued recession here,' said Parsons in a statement.

According to BUSA, it remains essential for the country to pursue counter cyclical policies and other measures to soften the impact of the recession on growth and jobs as well as company liquidations.

'BUSA hopes that the economy will bottom out by the end of 2009. The central challenge therefore remains to ensure the timely implementation of appropriate policies, including the possibility of yet another reduction in interest rates,' he said.